25L - AGMT VETERANS VILLAGE PROJ

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Loan Agreement with Santa Ana Village LP August 21, 2018 Page 2 In order for the HOME Program funds to be committed, all other financing must be in place. The City may not enter into a written agreement that commits HOME Program funds until all other required funding has been secured by means of a firm commitment, a budget and production schedule has been established, and underwriting completed. On June 13, 2018, Jamboree was awarded 9% low-income housing tax credits for the development of the Santa Ana Veterans Village project. As a result, all other required funding has now been secured for the project. A budget and production schedule has also been established and the project underwriting was completed by Keyser Marston Associates (Exhibit 2). For the HOME CHDO Loan Agreement, Jamboree proposes to utilize the $352,962.90 loan for the development of the Santa Ana Veterans Village (Project), a housing and service center for homeless veterans. The City's Loan Agreement for $352,962.90 in HOME Program funds will be provided by means of a 55 -year City loan carrying a three percent interest rate (Exhibit 3). Repayment will be from 50% of residual receipts (after payment of operating expenses, debt service for the conventional loan, Orange County Community Foundation and the County of Orange, any deferred developer fee, and partnership fees described in the Loan Agreement) with the remaining 50% to be disbursed to Jamboree. The affordability restrictions for all of the units in the Project will be 55 years and units will be restricted to homeless veterans. Regarding the Subordination Agreement with Union Bank, the City's total loan for this project is approximately 1.2% of the total Project cost (Exhibit 4). As a subordinate loan for a large affordable housing project such as this, it is not uncommon for a senior lender to request a Subordination Agreement -for the City's smaller Loan Agreement that allow the senior lender to -complete their underwriting and commit their private market financing. As such, this Subordination Agreement will allow Union Bank to commit their private market financing for the Project. If the Loan Agreement is not approved by City Council, $171,771.60 of the $352,962.90 in available HOME Program CHDO funds will be deobligated by HUD on August 31, 2018. These funds will no longer be available to the City to use for other projects. Project Description Jamboree's project, located at 3312 W. 1st Street in Santa Ana consists of a new construction development on a vacant site. The project will provide 71 one -bedroom units and five two- bedroom units. With the exception of a single one -bedroom property manager's unit, the remaining 75 units will be restricted to homeless veterans. The Project was previously awarded 75 HUD -Veterans Affairs Supportive Housing (VASH) project -based vouchers by the Housing Authority of the City of Santa Ana on April 4, 2017. The design will feature two three-story buildings including a multipurpose space, a private meeting office for the service provider, property management offices, a central laundry facility, a fitness room, a community kitchen, a community garden, and barbeque grills. Over 20% of the site is dedicated to open space and each unit will have private open space by way of individual balconies. The interior of the units will feature a full bathroom and a fully equipped kitchen with all appliances provided by the project, a clothing closet, storage space, and a living room. Wrap-around supportive services for the 25L-2